Correlation Between Leju Holdings and Ke Holdings

Can any of the company-specific risk be diversified away by investing in both Leju Holdings and Ke Holdings at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Leju Holdings and Ke Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Leju Holdings Limited and Ke Holdings, you can compare the effects of market volatilities on Leju Holdings and Ke Holdings and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Leju Holdings with a short position of Ke Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leju Holdings and Ke Holdings.

Diversification Opportunities for Leju Holdings and Ke Holdings

0.0

Correlation Coefficient

Leju Holdings  Ke Holdings

Pay attention - limited upside

The 3 months correlation between Leju and BEKE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Leju Holdings Limited and Ke Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ke Holdings and Leju Holdings is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Leju Holdings Limited are associated (or correlated) with Ke Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ke Holdings has no effect on the direction of Leju Holdings i.e., Leju Holdings and Ke Holdings go up and down completely randomly.

Pair Corralation between Leju Holdings and Ke Holdings

If you would invest  1,901  in Ke Holdings on December 17, 2024 and sell it today you would earn a total of  538.00  from holding Ke Holdings or generate 28.3% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Leju Holdings Limited  vs.  Ke Holdings

Leju Holdings Limited

Risk-Adjusted Performance

Very Weak

Over the last 90 days Leju Holdings Limited has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward-looking indicators, Leju Holdings is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Ke Holdings

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Ke Holdings are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather inconsistent forward-looking signals, Ke Holdings exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Leju Holdings and Ke Holdings

The main advantage of trading using opposite Leju Holdings and Ke Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Leju Holdings position performs unexpectedly, Ke Holdings can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Ke Holdings will offset losses from the drop in Ke Holdings' long position.

The idea behind Leju Holdings Limited and Ke Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Transaction History module to view history of all your transactions and understand their impact on performance.